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How Instacart’s Technical Instability Threatens Their Future

The sharing economy revolves around a digital service that can accept orders and send information to its contractor to carry out their function. When the service is unavailable, it is very disruptive to both contractors and customers. Contractors don’t have a way to fulfill their job and customers don’t get their product.

Timeline Instacart Technical Instability

Over the past three weeks, Instacart has suffered through multiple nationwide outages. The biggest outage was Easter Sunday when Instacart’s service was down for most of the day. Shoppers reported that the Instacart app was down from the early afternoon till very late at night. The outage was nationwide and prevented all shoppers from accessing Instacart’s system. Some shoppers eventually got a small bump for being online or scheduled for most of Easter Sunday but not being able to work. The bumps (Instacart’s compensation for the outage) varied between $5-$15 an hour during the outage. The Monday after Easter was very busy on Instacart since there were very few orders delivered on Sunday.

Here is the list of other noted outages of the Instacart app this year. These subsequent outages were much shorter in duration, ranging from an hour to a few hours. Many shoppers were able to finish their shift and/or current orders, but these outages were very disrupted to the shoppers.

February during the Amazon AWS outage

March 21

April 24th

April 30th (Easter Sunday Outage)

May 4th

May 8th

May 9th

May 15th

May 16th

As you can see with this list of outages, it is very disruptive. In the past three weeks, they have happened twice a week for an hour or two. The Easter Sunday outage was the most disruptive, but the smaller outages also cost many shoppers part of their daily income. I don’t believe that there were any compensation for the smaller Instacart outage. In addition, some shoppers noted that they haven’t received any orders in the hours leading up to the smaller outages, which may suggest that the outages were much longer than what many Instacart shoppers thought it was.

The worst part about these outages is that some shoppers risk losing Early Access because they haven’t worked enough hours to qualify. Once they lose Early Access, they won’t be able to pick up enough hours to work the following weeks, so the problem compounds.

How Lack of Stability Will Cost Instacart

You would think that a recent $400 million infusion in Instacart would pay for better technology to prevent outages, but Instacart shoppers seem to believe the opposite. Somehow with the additional capital, they managed to make the service less reliable, with 7 outages alone in the last month. Comparing Instacart’s technical stability to that of Lyft and Uber, Uber and Lyft are much better. The last time they had an outage was about two years ago during Halloween. Typically, those services crashed when there was a spike in demand, but not with Instacart. It seems to be technical glitches that took down Instacart’s service, annoying both shoppers and customers. Stability issues will cost Instacart customers since they don’t see this a service they can depend on. They may migrate to other online grocery competitors, such as Amazon Flex or Shipt. Instacart customers are already annoyed about the service fee and I believe that the technical glitches will be the push Instacart’s customer needs to try something else.

If stability was Instacart’s only problem, then it is easy to fix. However, stability is among other problems that Instacart has, such as it’s battle with shoppers and customers over the service fee and its struggle to make the company profitable while growing new markets. With this week’s technical glitches, I don’t see Instacart solving their technical issues anytime soon.